China now has India surrounded, wrapped up by land and sea via its Belt and Road initiative (BRI). In mid-May, Nepal agreed to a memorandum of understanding to participate in Chinese President Xi Jinping’s signature foreign policy power play, and officially signed on to become a key node along the Belt and Road.
According to East Asia Forum, two special economic zones, a pair of hydropower plants, and an international airport have been included in the investment mix. While the potential to link Nepal in with the Beijing-Lhasa Expressway and Qinghai-Tibet Railway is on the table.
It is China’s infrastructure building capacity that is really what Nepal is after. The World Bank estimates that Nepal requires roughly $13-18 billion directed towards infrastructure in order to maintain its status quo of economic growth, and China has presented itself as an effective donor, having sponsored such projects throughout the South Asian region.
This infrastructure need combined with political spats with India, which cumulated in what has been dubbed the blockade of 2015, have been pushing Nepal away from its southern neighbor and into closer ties with China and, by extension, the Belt and Road initiative. While many of the Nepal-China projects that are now included under the BRI banner have been retroactively added, pre-dating the start of the initiative, the political nod to Beijing is ultimately what is of significance about the new MOU.
The BRI is a program for increasing infrastructural, economic, and political connectivity between China and the other countries of Asia, Africa, and Europe. It is China’s participation in what has been loosely dubbed the New Silk Road — a multinational endeavor to better integrate the Eurasian landmass in a way that’s inspired by a romanticized rendering of the ancient Silk Road. Myanmar, Bangladesh, Sri Lanka, the Maldives, and Pakistan are all engaged with the Belt and Road, leaving India stuck in the middle as the sole objector.
India has always been suspicious of — and at times hostile towards — China’s forays into South Asia. Not only does Beijing’s plan of being at the center of a new pan-Eurasia economic order seem to usurp India’s vision of itself as the big man of South Asia, but also irks Delhi because these forays include an in-depth partnership with Pakistan — India’s arch-rival — and includes development projects in Pakistan controlled territory that India claims as their own.
However, crossing such political fault lines is at the heart of the philosophy behind the BRI. Declaring the typical geopolitical ordering of exclusive alliances between countries and blocs archaic and dead, through this initiative China is concurrently trying to develop partnerships with both Russia and the EU, Israel and Iran, Azerbaijan and Armenia, and, yes, India and Pakistan. If successful, the one common denominator that political and cultural rivals will have in common will be a close relationship with China.
The thinking here is that through the indiscriminate engagement of all facets of established political and cultural rifts without taking sides while developing the economies and improving the infrastructure of everybody involved with so-called “win-win” partnerships, China can work towards easing regional regional tensions while bolstering economic activity.
While India has been a very vocal opponent of the BRI, a view of the balance sheet indicates that the giant of South Asia has a very deep economic connection with China. To sum this position up in one point: China is India’s largest trading partner, with over $70 billion worth of goods passing between the two countries each year. For comparison, Pakistan — a core participant in the BRI— transacted a mere $14 billion in trade with China over the same period. Chinese companies have major stakes in some of India’s fasted rising companies — such as Paytm, Ola, and Snapdeal — are supplying trains for the Delhi metro, and have participated in major Indian infrastructure projects, as Chinese FDI flowing into India soars higher each year.
Whether owning up to it by name — or attending its summits — or not, India isn’t only wrapped up by the Belt and Road, but is almost unavoidably being absorbed into it.
By Wade Shepard